Correlation Between Massmutual Select and Kopernik Global

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Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Kopernik Global at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Massmutual Select and Kopernik Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Select Small and Kopernik Global All Cap, you can compare the effects of market volatilities on Massmutual Select and Kopernik Global and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Massmutual Select with a short position of Kopernik Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Kopernik Global.

Diversification Opportunities for Massmutual Select and Kopernik Global

MassmutualKopernikDiversified AwayMassmutualKopernikDiversified Away100%
0.67
  Correlation Coefficient

Poor diversification

The 3 months correlation between Massmutual and Kopernik is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Small and Kopernik Global All Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kopernik Global All and Massmutual Select is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Massmutual Select Small are associated (or correlated) with Kopernik Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kopernik Global All has no effect on the direction of Massmutual Select i.e., Massmutual Select and Kopernik Global go up and down completely randomly.

Pair Corralation between Massmutual Select and Kopernik Global

Assuming the 90 days horizon Massmutual Select Small is expected to generate 1.8 times more return on investment than Kopernik Global. However, Massmutual Select is 1.8 times more volatile than Kopernik Global All Cap. It trades about 0.04 of its potential returns per unit of risk. Kopernik Global All Cap is currently generating about 0.05 per unit of risk. If you would invest  882.00  in Massmutual Select Small on November 21, 2024 and sell it today you would earn a total of  91.00  from holding Massmutual Select Small or generate 10.32% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy99.56%
ValuesDaily Returns

Massmutual Select Small  vs.  Kopernik Global All Cap

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -8-6-4-202
JavaScript chart by amCharts 3.21.15MSVZX KGGAX
       Timeline  
Massmutual Select Small 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Massmutual Select Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Massmutual Select is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb9.49.69.81010.210.4
Kopernik Global All 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Kopernik Global All Cap are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Kopernik Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1111.111.211.311.411.511.611.711.8

Massmutual Select and Kopernik Global Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.65-1.24-0.83-0.42-0.04830.260.671.081.491.9 0.20.40.60.8
JavaScript chart by amCharts 3.21.15MSVZX KGGAX
       Returns  

Pair Trading with Massmutual Select and Kopernik Global

The main advantage of trading using opposite Massmutual Select and Kopernik Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Kopernik Global can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Kopernik Global will offset losses from the drop in Kopernik Global's long position.
The idea behind Massmutual Select Small and Kopernik Global All Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.

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